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www.cadtm.org/Open-letter-to-Yanis-Varoufakis
Open letter to Yanis Varoufakis: Plan B is democracy
by Thomas Coutrot
1 August 2015

Dear Yanis Varoufakis,

For five months, you have personified the hopes of many European citizens. You have brought a wind of intellectual rigor and honesty in the circle of gray men of the Eurogroup. You tried tenaciously to respect the mandate of Greek voters: breaking up with the austerity policies while remaining within the euro area. But late June, the zombies of the Eurogroup and the Council, reinforced by the isolation of Greece and weak solidarity movements in Europe, sent you an ultimatum: submit or leave the euro.

The victory of the “no” in the July 5th referendum had reinforced your legitimacy to refuse the diktat of creditors. On July 13th you revealed |1| the proposal you made to Alexis Tsipras on the night of the referendum, “a triptych of actions” to avoid submission: “issue IOUs” (acknowledgments of debt in euros, that is to say a complementary currency based on tax revenues), “apply a haircut on Greek bonds” held by the ECB since 2012 in order to reduce the debt, and “take control of the Bank of Greece from the hands of the ECB.” But Alexis Tsipras refused this plan and accepted your resignation.

On July 20th, at the Greek Parliament, you voted against the ‘Agreement’ of July 13th indicating the decisive point: “when society begins to feel in his gut the pain of the disastrous results of the new austerity plan, when young and older people will take the streets or remain desperate at home, faced with these effects, who will from now on represent those people we were the voice in the political arena?”.

The unity of Syriza, the tool patiently wrought by the Greek left, is precious. It seems that this is why you do not have publicly led the debate on your alternative proposals: “ “Was there an alternative?” the Prime Minister asked me last Wednesday. I believe that, yes, there was. But I’ll say nothing more. This is not the moment to discuss again. The important thing is that on the evening of the referendum, the Prime Minister said that there was no alternative. ”

Yet this choice made by Alexis Tsipras to capitulate, and worse, to implement himself the demands of the creditors, is tragic. Like you, we can only be frightened by the political consequences of July 13th: the radical left, brought to power and confirmed by referendum in its legitimacy to break with austerity, appeared not only as unable to refuse an austerity plan that destroys democracy, but also willing to manage it by herself. Even assuming that no other option is available in the short term, returning to the opposition, as you wished, would have better preserved the future.

But if a plan B was possible, as you think, then the mistake is even more tragic. This crucial debate is rising today in the European left. The Left Platform of Syriza has made a proposal on May 24th for the suspension of debt payments and nationalization of banks. Éric Toussaint suggested on July 13th a more comprehensive set of measures |2|, acknowledging the fact, now for all to see, that breaking with austerity implies a unilateral policy of necessity and urgency that will obviously be equated with disobedience by EU leaders of the day, although it does not necessarily violate existent treaties |3|.

Contrary to what assert such respectable figures as Etienne Balibar, Sandro Mezzadra and Frieder Otto Wolf |4|, such alternative proposals cannot be described as”authoritarian and unworkable concepts of ’control’ of monetary policy and capital flows “. Similarly, when the great sociologist Boaventura de Sousa Santos states that”if a country showed disobedient, it would be expelled and chaos would become inevitable“ |5|, one can oppose that, given the content of the July 13th “agreement”, chaos is assured if the country complies.

Pablo Iglesias, leader of Podemos, does not either see any alternative to the July 13th “agreement”, “the only thing we can do,” “the truth of power” |6|. But if there is no alternative, if no European country can break up with austerity without sinking into chaos - and there can be little doubt that Spain, Italy or France would face as such considerable obstacles as Greece |7| - the neoliberal trap is flawless. If no single country can take a step aside and engage in another route to show the way, the only remaining possibility is to maintain verbally the perspective of “another Europe” while waiting for a pan-European political crisis and / or a systemic collapse of the eurozone that would put all countries in the same boat.

For years, with others, we opposed to those who claim that exiting the eurozone is a prerequisite to any alternative policy. Leaving the euro has important economic and political costs for the country concerned. Also, to point “Germany” as the main culprit, and to advocate the return to the national scope of powers as the prerequisite for any solution, is a serious mistake that neglects the overwhelming responsibility of all national elites in the present situation while feeding the nationalist ethos.

However we believe just as you that there are credible alternative economic and monetary policies that could be undertaken unilaterally. Bold policies, for sure, but perfectly reasonable and certainly preferable to the certainty of the economic and political disaster the “agreement” of July 13th will lead. We believe just as you that Greece, in the present situation of necessity and urgency, could - and still can - unilaterally declare a moratorium on its debt, create a complementary currency, requisition the Central Bank and nationalize banks, establish an effective taxation of wealthier classes (remember that Greek employees and pensioners, subject to VAT on their consumption and the withholding of their income tax, cannot defraud).

These measures certainly involve risks, especially if they are improvised in haste: bank run, flight from the complementary currency, increased capital flight ... But the stronger popular support will be, the weaker the risks. The success of the June referendum and the unpopularity of the July 13th “agreement” show that a large social base potentially exists in Greece to support a policy based on dignity and justice, values ​ ​that were trampled by creditors. This policy could give hope to the European peoples and strengthen their solidarity so far insufficient.

Such unilateral measures will probably lead creditors to want to expel Greece from the eurozone, although this would greatly reduce their chances of being finally repaid. Furthermore they lack a legal basis for doing so, and such a sanction would aggravate EU internal geopolitical contradictions. To castigate a country that is bravely trying to get out of the abyss and solve its humanitarian crisis could have significant political costs for the gray men. The debate aroused could strengthen the construction of the European public space without which the necessary refoundation will remain wishful thinking. Because one thing is to turn its back on Europe as a culprit for all the problems; another is to demonstrate by action that one only can respect the will of voters and preserve the interests of the lower classes by breaking with the dictates of the gray men who have taken possession of the European Union.

Thanks to your clarity and tenacity during these months of negotiations, you and Alexis Tsipras were very close to provide this successful demonstration. Dear Yanis Varoufakis, you would be doing a great service to Greece and Europe by undertaking, in an open and public manner, the battle for Plan B, the struggle for democracy in Greece and the European Union.


Footnotes :

|1| www.newstatesman.com/world-affairs/2015/07/exclusive-yanis-varoufakis-opens-about-his-five-month-battle-save-greece, published July 13

|2| Eric Toussaint, “Greece: Alternatives to the Capitulation”, cadtm.org/http://cadtm.org/Greece-Alternatives-to-the

|3| Attac and Fondation Copernic, Que faire de l’Europe. Désobéir pour reconstruire, Les liens qui libèrent, 2014

|4| Etienne Balibar, Sandro Mezzadra Frieder Otto Wolf: “Le Diktat de Bruxelles et le dilemme de Syriza », http://blogs.mediapart.fr/blog/ebalibar/190715/etienne-balibar-sandro-mezzadra-frieder-otto-wolf-le-diktat-de-bruxelles-et-le-dilemme-de-syriza

|5| Boaventura de Sousa Santos,”Fatal tests", 23.7.2015

|6| www.europapress.es/nacional/noticia-pablo-iglesias-resignado-ocurrido-grecia-verdad-poder-20150716153300.html

|7| Unlike Greece, Spain finances its debt and huge deficit on the financial markets, but would face soaring interest rates in the event of testing an alternative policy.

Thomas Coutrot